Role of IT Executives on Their Firm’s Ability to Achieve Competitive Advantage Through IT Capability

International Journal of Accounting Information Systems, Forthcoming

Posted: 15 Jun 2011 Last revised: 20 Jul 2014

See all articles by Jee-Hae Lim

Jee-Hae Lim

University of Hawaii, Manoa

Theophanis C. Stratopoulos

University of Waterloo - School of Accounting and Finance

Tony S. Wirjanto

University of Waterloo - School of Accounting and Finance; University of Waterloo, Department of Statistics & Actuarial Science

Date Written: June 14, 2011

Abstract

Contrary to prior studies that have tried to examine the role of IT capabilities on firm performance in isolation from the role of senior IT executives, we propose that there is a positive relationship between the power of senior IT executives and the likelihood that the firm will develop superior IT capability. Furthermore, the contribution of IT capability to a firm’s competitive advantage is much stronger in firms with powerful senior IT executives as they are the driving force that may ensure the continuous renewal of IT capability. We develop a two-stage econometric model designed to test the contribution of senior IT executives on their firm’s ability to achieve superior IT capability, and the impact of co-presence of powerful senior IT executives in firms with superior IT capability on their firm’s competitive position. Empirical evidence based on a sample of large US firms strongly supports our hypotheses.

Keywords: Business Value of IT, CIO, IT capability, Structural Power, Tobin's q

JEL Classification: L25, M15, C33

Suggested Citation

Lim, Jee-Hae and Stratopoulos, Theophanis C. and Wirjanto, Tony S., Role of IT Executives on Their Firm’s Ability to Achieve Competitive Advantage Through IT Capability (June 14, 2011). International Journal of Accounting Information Systems, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1864846

Jee-Hae Lim

University of Hawaii, Manoa ( email )

2404 Maile Way
Honolulu, HI Honolulu 96822
United States
(808) 956-8503 (Phone)
(808) 956-9888 (Fax)

HOME PAGE: http://shidler.hawaii.edu/directory/jee-hae-lim/soa

Theophanis C. Stratopoulos (Contact Author)

University of Waterloo - School of Accounting and Finance ( email )

200 University Avenue West
Waterloo, Ontario N2L 3G1 N2L 3G1
Canada
519-888-4567 x35943 (Phone)

Tony S. Wirjanto

University of Waterloo - School of Accounting and Finance ( email )

200 University Avenue West
Waterloo, Ontario N2L 3G1
Canada
519-888-4567 x35210 (Phone)

HOME PAGE: http://https://uwaterloo.ca/statistics-and-actuarial-science/people-profiles/tony-wirjanto

University of Waterloo, Department of Statistics & Actuarial Science ( email )

200 University Avenue West
Waterloo, Ontario N2L 3G1
Canada
519-888-4567 x35210 (Phone)
519-746-1875 (Fax)

HOME PAGE: http://math.uwaterloo.ca/statistics-and-actuarial-science/people-profiles/tony-wirjanto

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